By Beaven Dhliwayo.
Harare. (News Of The South) – Axia Corporation Limited, the logistics and distribution arm of conglomerate, Innscor Africa Holdings reported a revenue of $134.328 million, a 33 percent jump for the six months ended 31 December 2017 compared to the same period in 2016.
The main operating units in the Group are TV sales and Home (TVSH), Distribution Group Africa (DGA) and Transerv.
The Group announced that it delivered a good set of results during the six months under review despite experiencing challenges in making foreign payments to suppliers, difficulty in securing import permits and constraints in supply of some local products.
An operating profit of $13.333 million and a profit before tax of $13.773 million were recorded for the period under review.
The Group Chairman, Luke Ngwerume said both basic and headline earnings per share for the period amounted to 1.19 US cents.
He said headline earnings were 60 percent above the comparative period and when adjusted for income earned on the derivative option were 29 percent above prior year at 0.96 US cents.
Ngwerume said the Group took proactive action to secure additional inventory and to settle foreign creditors as rapidly as possible resulting in a significantly changed working capital profile.
“The Group’s capital expenditure for the six months totalled $2.134 million. Net borrowings have increased by $3.528 million to support working capital investment in inventory,” he said.
The Group reassessed its position of control of Transerv where it has an effective 26.01 percent share, he said, adding that the board decided to equity account the results of Transerv with effect from July 2017 and only consolidate the business when an effective holding above 50 percent is achieved.
Additionally, Ngwerume said through a scheme of reconstruction, the Group has consolidated the results of Hat On Investments (Pvt) Ltd and Baobab Africa (Pvt) Ltd through its subsidiary DGA (Pvt) Ltd with effect from July 1 2017.
He said there has been no change in the Group’s shareholding in Baobab whilst the effective shareholding in Hat On increased by 0.02 percent.
“This change will improve efficiency in reporting, monitoring and control, and other administrative work in the distribution business.
“The acquisition of Hat On and Baobab by DGA Zimbabwe resulted in goodwill of $0.02 million dollars on consolidation of DGA, adding that management has taken the decision to impair the $0.02 million goodwill.”
Going forward, Ngwerume said the Group will actively manage inventory levels and foreign exposures in accordance with environmental changes.
He said the Group will continue to be proactive in settling high risks foreign creditors and maintaining good relationships with suppliers and financial service providers.
“Focus will be on securing inventory to ensure superior offerings to customers, revenue generation, increasing vigilance on trade receivables and managing costs to enhance profitability.”
He said the Group has declared an interim dividend of 0.40 US cents per share in respect of all ordinary shares of the company.
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